Eugene Securities evaluated on the 24th that regarding Samyang Foods, the decrease in operating profit is not significant even with the U.S. tariffs, and it is at a manageable level considering global demand. The target price has been raised to 1.1 million won and the investment opinion is maintained as "buy."
Kim Jin-woo, a researcher at Eugene Securities, noted, "If a 25% tariff continues to be imposed after July, the annual operating profit impact this year is estimated to decline by 3.8% compared to the no-tariff scenario," and he explained, "Considering the brand power of the spicy chicken product and strong global demand, it is deemed fully manageable."
Samyang Foods' first-quarter revenue is expected to reach 497.1 billion won, which is an increase of 4% compared to the previous quarter and 29% compared to the same period last year. Operating profit is also expected to grow by 22% and 33% during the same period, reaching 106.7 billion won. Revenue matches market expectations (consensus), while operating profit is likely to exceed consensus.
The factory expansion is expected not to deviate significantly from the planned schedule. The completion of the Miryang No. 2 plant has a low likelihood of being delayed by more than one month, and even if there is a delay, it is not expected to exceed 2 to 3 weeks.
Kim stated, "This is a short-term issue that does not affect the company's fundamental performance," and he added, "Since it appears that early commissioning of the equipment has begun before the completion, it seems there will be no issues with reflecting the quantities in performance starting from the third quarter."